Telehealth Services Exemption for High Deductible Health Plans (HDHP) Will Expire December 31, 2024

President Biden signed the American Relief Act of 2025 (H.R. 10545) on December 21, 2024. This funds the government through March 14, 2025 and provides disaster relief and economic assistance to farmers.

However, the Act does not include the extension of the HDHP telehealth flexibility, sometimes called the First Dollar Coverage of HDHPs-HSAs tax provision.

The Medicare telehealth flexibilities received a short extension and will expire March 31, 2025.

Plan Sponsors offering HDHPs with Health Savings Accounts (HSAs)

For plans with HDHPs that have HSAs and the plan years began before January 1, 2025, the plan can continue to reimburse individuals for telehealth services before the deductible is met for the rest of that plan year.

But, for HDHPs that have HSAs and the plan year begins January 1, 2025 or later, plans may not reimburse individuals for telehealth services before the individual meets their deductible. If the plan were to permit reimbursement before the deductible is met, the HDHP would not be HSA-qualified, and participants could not contribute to the HSA for the plan year.

Plans/Plan Sponsors/brokers need to be sure that telehealth services provided before the HDHP deductible is met are subject to cost-sharing.

Plan Sponsors/brokers should be contacting the insurance carrier and/or their administrator to discuss the following:

How will the ‘new’ benefit be implemented in the HDHP?

Will they be communicating the changes to plan participants?

Do plan documents need to be amended?

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